Dive Brief:

NRG Energy is selling its renewable energy development business and a group of generators in the Southeastern United States as part of a reorganization process announced last summer.

NRG will sell its ownership in NRG Yield and NRG's Renewables Platform to Global Infrastructure Partners for cash proceeds of $1.375 billion. The NRG businesses oversee 2.4 GW of generation across 17 states and a development pipeline of more than 6 GW.

NRG will also sell its South Central business, comprising more than 3.5 GW of coal and gas generation, to Cleco Corp. for $1 billion.

Dive Insight:

NRG's Wednesday announcement advances corporate reorganization goals the company outlined last July. At the time, NRG leadership said they would aim to reduce company debt by $13 billion and raise $4 billion in revenue through the sale of both renewable and conventional assets.

NRG says the Wednesday sales of its renewable energy business and Southern generators will bring in $2.8 billion and reduce debt by $7 billion. The company also revised its revenue target for asset sales down to $3.2 billion.

Under the sale, GIP would become the controlling shareholder of NRG Yield and acquire a 6.4 GW project pipeline from its NRG's renewable energy developer. NRG Energy, however, would buy the 154 MW Buckthorn Solar Project and the 527 MW Carlsbad Energy Center from the yieldco before it is sold.

In the South Central deal, Cleco will receive natural gas power assets including the 225 MW Bayou Cove plant, the 1,263 MW Cottonwood generator, the 176 MW Sterlington plant. It will also get 1891 MW of coal-fired capacity at the Big Cajun-I and Big Cajun-II generators in Louisiana. NRG, however, would lease back the Cottonwood plant from Cleco until 2025.

The renewables deal must be approved by the Federal Energy Regulatory Commission, Department of Energy and utility regulators in California, Connecticut and Pennsylvania, as well as pass an antitrust review. The transaction is not subject to shareholder approval.

The South Central deal must be approved by FERC, Louisiana regulators, the Committee on Foreign Investment in the United States (CFIUS), and pass an antitrust review.

NRG said in a statement it expects both sales to close in the second half of the year.

The sale announcements come after reports late last summer that GIP, NextEra and others could be in the hunt for NRG's renewable energy assets. NRG has been pushing to transform its business model as an independent power producer since last spring, when CEO Mauricio Guttierez called the model "obsolete," and the company said it "expects to announce additional asset sales over the course of 2018."